Indonesia's steel dumping allegation against five countries considered weak

JAKARTA, The Point The dumping allegation by Indonesia on hot rolled coil (HRC) steel import from China, India, Russia, Taiwan and Thailand is considered weak.

Indonesian Machineries and Metal Works Companies Association (Gamma) chairman Ahmad Safiun in a hearing with the Indonesian Anti Dumping Committee (KADI) said some of the arguments in the anti dumping petition on HRC can easily be weakened.

"The index in the national HRC production data is wrong. If that is an index, it should not have been measured in metric tons. If one of the data in the petition is wrong, the petition is not valid as it does not reflect the facts," he said.

Safiun said the petition made by the state owned steel company Krakatau Steel (KS) stated that national steel production index from 2003-2005 had increased, when in fact the HRC downstream industry was facing raw material shortages.

"The Finance Minister's decree number 46/2004 stated that imports of steel and iron plates were exempted from import duty as we were facing steel raw material shortages," he explained.

Another factor that would weaken the dumping allegation is KADI's failure to verify data with the exporting country (China)."So, it is only using data provided by the petitioner," he said.

Lawyer for the HRC exporting countries for Russia and Thailand, A. Setiadi, said the products accused of dumping were not'the same as the ones produced by the local steel industry and thus does not meet the dumping criteria.

"It (KS) only produces HRC measuring 1.8-2.5 mm. Those imported are measuring 1.2 mm and 1.5 mm. It can be accused dumping only if they were of the same products," Setiadi was quoted by Antara as saying.Setiadi also said that the injury calculation by KADI was wrong as it did not include the transportation cost.

"They (KADI) did not calculate all the transactions. So, there was a slight error as the preparations of the petition were made in a hurry. We will submit supporting documents this Friday," he added.

Dumping practices mean that exporters are selling their products at prices lower than local prices. Setiadi said the normal domestic price should have been calculated by including the transportation costs apd reasonable profit expectation.."If it is added with transportation cost, the price (between local and imported products) would at least be the same. The production cost between us is the same, except that the technology used is different," he explained.

Setiadi said with that calculation, one of his clients from Russia, Novolipetsk Steel, which was accused of dumping around 12.71% will be free of charge.

New dumping allegations can be proven only with causal connection between the injury and the importer. Setiadi said in this case, KADI could not provide sufficient evidence.

"So, in the petition, there was an argument saying that KS was forced to sell products overseas due to import increase. It shifted its market overseas. Logically, it should enjoy profit if it really exported, but the fact is it suffered losses. That's because their prices are cheaper. They're the ones practicing dumping," he said. (ASW)